MONTREAL — McGill University Health Centre executive director Arthur T. Porter soaked up accolades after informing his board of directors in 2009 that all was in order to announce the winning bidder to build a new super-hospital. The board chairman, Senator David Angus, “praised A.T. Porter’s visionary thinking and his perseverance,” according to minutes of a Dec. 3, 2009 board meeting made public Thursday by the Charbonneau commission into corruption.

But in fact, the commission heard from its investigator, Mr. Porter had been performing more like a bully than a visionary, throwing his weight around like “a little tough in the schoolyard” to ensure a consortium led by SNC-Lavalin Inc. won the lucrative contract even though a rival consortium’s bid scored higher.

André Noël’s testimony offered the first glimpse of how Mr. Porter, who with seven others has been charged in a conspiracy to defraud taxpayers of $22.5-million in connection with the hospital project, is alleged to have rigged the bidding.

The investigator said Mr. Porter used the pretext of a substitution of one member of the rival consortium — a building maintenance firm — to disqualify it from the bidding at the last minute. This came after evaluations performed by a number of MUHC selection sub-committees in the fall of 2009 had ranked the rival, led by the Spanish company OHL, above SNC on most counts.

Mr. Porter was prepared to mislead the government and his board in an effort to have the SNC bid selected, Mr. Noël testified. In a Dec. 2, 2009 meeting with the provincial health minister and treasury board president, Mr. Porter and Mr. Angus explained that the OHL consortium had been disqualified. They were told to get a signed release from OHL to avoid a possible lawsuit.

The next day, an MUHC official, St. Clair Armitage, met with the head of the OHL bid to inform him of the disqualification and try to sweeten the compensation pot. Mr. Armitage said the MUHC foundation, which raises money to support research and patient care, would contribute $2.5-million on top of the $7.5-million compensation provided for in the bidding documents. Mr. Noël said there is no evidence the foundation had agreed to the payment and speculated that the money would have come from another source.

In any event, OHL refused to withdraw, but that did not stop Mr. Porter from recommending that the board approve the SNC bid. Mr. Armitage delivered the good news to an SNC official in person, giving the man a bear hug, Mr. Noël testified.

But on Dec. 4, the OHL consortium sent a lawyer’s letter to the provincial agency responsible for public-private partnerships such as the MUHC project. It noted that the MUHC was in discussions with the SNC consortium about the project, a “flagrant violation” of the contract-tendering rules.

John Kenney/Postmedia NewsArthur Porter at the construction site of the McGill University Health Centre super hospital in 2010.

After telling the MUHC board that a government announcement of the winning bidder would be made on Dec. 7, Mr. Porter’s bluff was called when the government insisted on a signed release from the losing consortium. On Dec. 8, Messrs. Porter and Angus wrote to the health minister and treasury board president, saying the delay endangered plans to improve health care for Montrealers, but the government remained firm. Instead, the health minister ordered a new submission process with a March 2010 deadline, and an increased maximum bid of $1.3-billion, up from $1.1-billion. (Both consortiums had come in above the limit at about $1.8-billion in the first round.)

Mr. Noël said that for the second round of submissions, the MUHC selection committees were changed to place SNC supporters in key positions and get rid of those who favoured the OHL project. He said the SNC consortium was even able to use technical drawings from the rival consortium in its revised proposal, which former MUHC executive Yanai Elbaz slipped them.

Mr. Elbaz is among the eight charged in the corruption case, as are Mr. Armitage — a Brit who left the MUHC in 2010 and is wanted under an Interpol warrant — and former SNC chief executive Pierre Duhaime. Mr. Noël testified that Mr. Armitage and Mr. Duhaime were next-door neighbours and friends.

The province announced on April 1, 2010 that the SNC consortium had won the contract to build the hospital. “Our consortium is thrilled to have earned the privilege to develop the MUHC’s Glen Campus,” Mr. Duhaime was quoted saying at the time.

Mr. Noël maintained that SNC won because it had a lot of help from friends in high places at the MUHC. “They managed to manipulate this process in a skillful way,” he said of Messrs. Porter, Elbaz and Armitage. “Sometimes it was subtle, sometimes it was less so.”

At that point it was “absolutely impossible” that coming forward would have resulted in criminal charges, said Mulcair, who is a lawyer.

Media have posted a statement given by Mulcair in July 2011 to police in which he says Vaillancourt repeatedly told him, “I’d like to help you,” while holding up an envelope in his hand.

The statement reportedly quotes Mulcair as saying he discussed the meeting with fellow Liberal Vincent Auclair, to whom Vaillancourt also allegedly offered an envelope.

Mulcair said he was contacted in 2011 by the anti-corruption squad created by the province in the midst of numerous Quebec scandals.

“Once the investigation was started, I was contacted to see if I would help and I was happy to do so,” he said Tuesday.

He said he had no trouble doing his job as a member of the provincial legislature and later a minister in the Charest provincial cabinet because he had refused the envelope.

‘He’s got some important questions to answer to Canadians about what he knew about this corruption’

But the Conservative government isn’t satisfied with Mulcair’s explanation.

“He’s got some important questions to answer to Canadians about what he knew about this corruption, why he covered it up, why he actually lied about having been offered an envelope of cash and these are important things for Mr. Mulcair to come clean with about Canadians,” said government House Leader Peter Van Loan.

He was referring to comments by Mulcair, during a 2010 news conference, that he had never been offered a cash envelope in Laval. He maintains that he never actually had proof he was being offered a cash envelope.

Vaillancourt now faces several corruption-related charges, including gangsterism. He is denying the criminal charges against him and has, in the past, also denied offering bribes to fellow politicians.

One of those alleged targets was Serge Menard, a former federal and provincial MP with the Bloc Quebecois and Parti Quebecois. Menard was allegedly offered $10,000 cash by the mayor in 1993.

Like Mulcair, he was a rookie provincial politician on the verge of winning his first election. And like Mulcair, he says he refused the money, then decided to remain publicly silent about the incident.

Menard, a lawyer, is quoted in a Montreal’s La Presse report saying that what happened two decades ago is not technically illegal — because corruption laws apply to civil servants, ministers and legislators.

He told the newspaper that the relevant Criminal Code articles don’t make any reference to exchanges that involve regular citizens running as candidates for office — which is what he and Mulcair were at the time of Vaillancourt’s alleged offer.

Events in Laval are now under the microscope at the Charbonneau commission. Police allege that the city administration was run like a criminal racket, hence the gangsterism charges against the ex-mayor.

At the Charbonneau inquiry, a retired engineer confirmed Tuesday that he collected about $2.7 million in kickbacks from participants in a system of collusion that was operating in Laval between 2003 and 2009.

Roger Desbois testified the funds were diverted to Vaillancourt’s municipal party and that the mayor was aware of the scheme. He said he was recruited into the plan in 2002 by Claude Asselin, the city’s former director-general.

Asselin, he said, had done the job before him.

The money came from contractors who obtained work on the city’s sidewalks, aquaducts and paving. The kickbacks were for about two per cent of the value of the contract.

Desbois also worked as a fundraiser for Vaillancourt and said the mayor asked him who was a good contributor and who was not.

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After being prodded by commission chair France Charbonneau, Milioto said he did know what omerta was — the code of silence and rule not to speak to authorities.

Milioto has been described as a key player in the wheel of corruption _ the person who was the link connecting the Mafia, a major municipal political party and certain parts of the construction industry.

Police say he was spotted 236 times at a famous Mafia hangout in east-end Montreal, the now-shuttered Cafe Consenza.

As for the exploits of Nicolo Rizzuto Sr. and his son Vito Rizzuto, Milioto says he’s read about them in the papers or seen stories about their organized crime on television.

He said he didn’t know if the family’s involvement in organized crime was simply an invention of the media.

“What is the Mafia? It’s difficult to define,” Milioto said.

THE CANADIAN PRESS/Graham HughesA photo taken in Montreal, Wednesday, September 26, 2012, from an RCMP surveillance video presented as evidence at the Charbonneau commission, an inquiry looking into corruption and collusion in Quebec's construction industry, allegedly shows Nick Rizzuto Sr., right, exchanging tens of thousands of dollars with Nicolo Milioto, left, former head of Mivela Construction Inc. Also at the table is alleged mafiosa Rocco Sollecito

MONTREAL — The exclusive 357C club in Old Montreal is treasured by members as a refuge from prying eyes, a place where business can be conducted “in the utmost comfort and discretion,” according to its website.

But last month, six investigators for Quebec’s Charbonneau commission descended on the private club, looking for evidence of shady dealings conducted within the wood-panelled walls.

They were given access to a club database covering years of appointments. On Tuesday, the inquiry began hearing evidence that will likely shatter the comfort of some members and their guests.

Michel Décary, a lawyer representing the Quebec Liberal Party, sought a partial publication ban to provide time to confer with two clients, whose names appear as guests of people targeted by the commission. In the end, it was agreed the names of the two Liberals would not be made public before Wednesday, and he dropped his request for a ban.

Investigator Erick Roy did not get far into his testimony when proceedings adjourned for the day. But it was already clear 357C was a favourite haunt of certain construction contractors and engineers, and their guests sometimes included public servants and elected officials.

The inquiry had already heard city engineer Gilles Vézina was entertained at the club by Nicolo Milioto, a sidewalk builder and alleged Mafia middleman.

Another witness, loan shark Elio Pagliarulo, described delivering large sums of cash to construction contractor Paolo Catania at a private club in Montreal. He testified the money was intended for Frank Zampino, then head of Montreal’s executive committee, and twice he saw Mr. Zampino at the club.

Although Mr. Pagliarulo never identified the club, Mr. Roy testified Tuesday Mr. Catania, president of Construction Frank Catania Inc., was a member of 357C, and hosted Mr. Zampino at the club twice in 2006.

Other members of interest to the commission include Joe Borsellino of Garnier Construction, Bernard Poulin, president of the engineering firm Groupe S.M. International Inc., and Pasquale Fedele, a former associate of Mr. Catania who is now president of Civ-Bec Inc.

Messrs. Catania, Fedele and Zampino were arrested this year over an alleged fraud scheme related to a Montreal public contract worth more than $300-million.

Also arrested at the same time were several people Mr. Roy identified as guests at 357C in 2005-06: Bernard Trépanier, finance director for the Union Montreal political party, Martial Fillion, former general manager of the city’s housing corporation, and Daniel Gauthier, an urban planner working in the private sector.

The 10-year-old, non-profit 357C was the creation of Daniel Langlois, a software developer and arts patron, and its association with Quebec’s corruption inquiry is a delicate matter.

Commission counsel Denis Gallant acknowledged as much when he began his questioning of Mr. Roy.

“What we are going to discuss today is a tiny portion of the membership of this club,” he said, noting 357C’s management co-operated fully with investigators.

“In my opinion, the place is not important. It could have been in restaurants or anywhere else. I really don’t want to focus on the club, but on the meetings.”

National Post

]]>http://news.nationalpost.com/news/canada/quebec-corruption-investigation-turns-to-dealings-in-montreals-exclusive-club-357c/feed2stdCommission investigator Erick Roy testifies Tuesday at the Charbonneau Commission, showing commissioners a list of names of members of the exclusive 357C club in Old Montreal that included construction magnates Paolo Catania and Joe Borsellino, and city of Montreal officials Frank Zampino and Bernard Trépanier. Investigators say they have proof that construction bosses, representatives from engineering firms and municipal and provincial politicians held regular meetings inside.Federal tax money funded Quebec's corrupt construction projects, probe revealshttp://news.nationalpost.com/news/canada/federal-tax-money-funded-quebecs-corrupt-construction-projects-investigation-reveals
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MONTREAL — Taxpayers across the country had their money spent on Quebec construction projects identified at an eye-opening corruption inquiry as suffering cost overruns through collusion schemes, a review of contracts by The Canadian Press has revealed.

A search through public contracts tabled at the province’s corruption inquiry has revealed numerous cases where federal money went to projects whose price tag was, according to witness testimony, inflated by scams.

The 91 contracts reviewed had been tabled at the inquiry in recent weeks as a pair of witnesses — a disgraced construction boss and Montreal city official — walked the commissioners through their role in the bid-rigging process.

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A subsequent scan through those contracts has shown that at least 15 received federal funding, with the federal contribution in each case ranging from under $200,000 to more than $700,000.

And that could be merely the tip of the iceberg. The Canadian Press only examined documents tabled during the testimony of two early inquiry witnesses, only in the City of Montreal, only for sewer work, and linked to only one federal program.

The corruption inquiry has been shedding light on collusion tactics that raised the cost of Quebec projects by as much as 35 per cent — as the Mafia, certain political parties, construction companies and corrupt city officials all cashed in on the illicit spoils.

The inquiry is still underway but it has already prompted the resignation of the mayors of Montreal and the big suburb next door, Laval.

Asked about those 91 contracts, the federal government has insisted that no new safeguards are necessary for the transfer of infrastructure dollars.

The Government of Canada says it sets a budget for infrastructure, but it’s provincial governments that are responsible for choosing suitable projects.

A number of contracts qualified for funding under the Canada-Quebec Infrastructure Program Agreement, which started in 2000 and under which Ottawa contributed one-third of the costs.

That specific federal-provincial program sent $505 million to Quebec over a decade, before wrapping up in 2010, and did not include historic multibillion-dollar stimulus programs after 2008.

The Canada Economic Development for Quebec Regions, which oversaw the Canada-Quebec IPA program, says there is no indication in audits that any money was misspent.

“Each year, the governments of Quebec and Canada agreed on an audit plan. The plan is carried out by an external audit firm and the results have shown no irregularities,” said Stephane Dufour, director of business development for the federal agency.

The inquiry has heard that collusion is difficult to detect.

While testifying, one crooked Montreal bureaucrat even bragged that his own bosses might have failed to catch him, had they wanted to, because he was so good at hiding inflated costs.

And the federal audits did not look as closely at the projects as the Charbonneau Commission is currently doing. Contracts are now being projected onto overhead screens while witnesses are asked to comment on them, one at a time.

The Canadian Press reviewed 91 tabled during the testimony of two witnesses who said they participated in bid-rigging: ex-construction boss Lino Zambito and retired city engineer Gilles Surprenant.

The result: more than a dozen dirty deals cited at the probe were funded by the feds.

The federal contribution to these questionable sewer deals represented 33.3 per cent of the winning bid. For example, Ottawa’s share of a $2.29 million sewer contract in 2004 in the north-end borough of Ahuntsic was $764,636. In a 2003 example, the federal contribution for an almost $600,000 sewer deal in Rosemont, a district in eastern Montreal, was nearly $200,000.

The allegations made inside the inquiry have not been proven outside, and could be subject to contradictions in the remaining months of testimony.

A total of 891 projects were approved by the feds under that IPA program in Quebec.

The federal role was to review submissions for projects already accepted by Quebec, and to determine whether they met the criteria for the program.

While the federal government provided the cash, most of the responsibility for vetting and dealing with applicants fell to Quebec, Dufour said.

Quebec’s own audit of the program showed no irregularities. The inquiry has heard in other testimony that the province was ill-equipped to guard against corruption because of a shortage of qualified staff and heavy workloads.

The province is now creating additional safeguards, such as hiring more engineers. As for the federal government, while the national Competition Bureau is examining corruption schemes in the province, it doesn’t appear to be planning new safeguards.

Dufour says the federal government is confident that the existing ones work properly.

“For all our programs, checks and balances measures are already in place and ensure the sound management of our programs,” Dufour said.

The federal government is being pressured to spend more money on municipal infrastructure.

Canadian cities are currently demanding a major increase in federal funding, by $2.5 billion a year to $5.75 billion, which they say is desperately needed to address aging infrastructure. The current federal funding regime ends in 2014 and the Conservative government is working on a new plan.

Dufour won’t say whether the federal government is taking a second look at any past Quebec contracts. But he says it could.

“Each case is a particular case,” Dufour said.

“In instances like the ones you are referring to we would analyze the situation, the available evidence, and then evaluate the remedies available under the existing agreements.”

Since the contracts were between Quebec and the contractors, he said it would be up to the provincial government to seek legal recourse.

However, he said the federal government could call in the police: “In the event that there is a suspicion that a criminal act was committed, law-enforcement authorities will be informed.”

The Canadian Taxpayers’ Federation says the feds should just get out of funding projects better handled by other levels of government.

“Even if there were no allegations of corruption, it’s just a dumb idea for the federal government to be mucking around with water plants and potholes and things for which they have no specific expertise,” said Gregory Thomas, the organization’s director.

Thomas said the funding process is flawed and lacks proper follow-up.

He said that there is a tremendous overhead cost in taking money from people in a province, then sending it back to them for provincially funded projects.

“It’s a bad model and it doesn’t enhance accountability,” he said.

The Quebec inquiry will not examine the federal role. A spokesman for the probe has explained that any questions touching on the feds could be ruled out of bounds.

That includes questions about whether Ottawa had the proper oversight — and whether federal political parties also benefited from illegal donations from construction companies.

But Thomas said the probe should still interest the federal government. He said people across the country have a right to be angry about the allegations coming out of the inquiry.

“Every dirty transaction, every dime that goes to organized crime, undermines the fabric of the country,” he said.

“(It’s) not just the City of Montreal or the province of Quebec.”

]]>http://news.nationalpost.com/news/canada/federal-tax-money-funded-quebecs-corrupt-construction-projects-investigation-reveals/feed0stdMichel Cadotte, a local businessman, took the stand at the Charbonneau Commission in Montreal, Thursday, November 22, 2012, which is an inquiry looking into corruption and collusion in the Quebec construction industry.Montreal Mafia boss Vito Rizzuto summoned to Quebec corruption inquiry: reportshttp://news.nationalpost.com/news/canada/montreal-mafia-boss-vito-rizzuto-summoned-to-quebec-corruption-inquiry-reports
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MONTREAL — Police confirm they have met with Vito Rizzuto amid reports that he has been summoned for what would be the memorable spectacle of a reputed Mafia don testifying at Quebec’s corruption inquiry.

Provincial police will not comment on the inquiry appearance first reported by Radio-Canada, the French-language CBC.

The news organization said police delivered subpoena papers to Rizzuto, who was alleged to have been this country’s most powerful Mafia figure and head of a crime family with myriad international ties.

The sight of a prominent underworld figure answering questions on a live TV broadcast would only be the latest twist in an inquiry that has shocked Quebecers, and the country.

Such an event would be extremely rare.

Nearly four decades ago members of the Cotroni-Violi family, whom the Rizzutos violently supplanted, were called as witnesses to the last Quebec inquiry into organized-crime corruption.

The witnesses back then were unco-operative.

“I don’t refuse to testify,” crime boss Paolo Violi told the 1974 inquiry, in an account described in a book about the Rizzutos, “The Sixth Family.”

“I have a lot of respect for the court but I don’t have anything to say.”

He was slapped with a one-year jail sentence for contempt of court.

Rizzuto has been referred to only in brief snippets at the current inquiry.

Witnesses described meeting him on golfing trips with construction-industry players.

The U.S. Department of JusticeMurdered Canadian gangster Gerlando Sciascia, left, looks for the car keys while Joseph Massino, right, waits to get into a car in New York in 1981. In the middle, in the dark suit, is Montreal's Vito Rizzuto.

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One crooked Montreal civil servant testified that he liked Rizzuto, and found him a charming and entertaining travel companion.

Rizzuto’s late father, Nicolo, has played a more prominent role at the inquiry.

Police surveillance footage has shown him stuffing cash into his socks after receiving it from construction bosses.

The inquiry has heard that bid-rigging construction cartels in Quebec drove up the cost of public works with the help of corrupt municipal officials, then shared some of the profits with the Mafia and through kickbacks to the officials and political parties.

The mayors of Montreal and nearby Laval have resigned as a result of the ongoing scandal.

The police surveillance footage of the elder Rizzuto was recorded while Vito Rizzuto was in prison on a decades-old U.S. murder charge.

He was released from a Colorado penitentiary several weeks ago.

During his years behind bars, the Rizzuto family faced a violent putsch. Many of Rizzuto’s friends and family disappeared or were killed, including his father and a son who were both gunned down.

Police now believe people loyal to Rizzuto may be behind several retaliatory acts since he was released.

]]>http://news.nationalpost.com/news/canada/montreal-mafia-boss-vito-rizzuto-summoned-to-quebec-corruption-inquiry-reports/feed0stdVito RizzutoA video still frame from an RCMP surveillance video allegedly shows Nick Rizzuto Sr., (right) exchanging tens of thousands of dollars with Nicolo Milioto (left), then the head of Mivela Construction Inc. and Rocco Sollecito, shown during the Charbonneau Commission hearing in Montreal in September.MAFIA TAKEDOWNNo bribes, no deal: In 2007, pipe-maker refused to pay $150K kickback; the product hasn't been used by Montreal sincehttp://news.nationalpost.com/news/canada/no-bribes-no-deal-in-2006-pipe-maker-refused-to-pay-150k-kickback-the-product-hasnt-been-used-by-montreal-since
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MONTREAL — As sales director for a Montreal manufacturer of PVC pipe, Michel Cadotte had been trying for over a decade to get his company’s product used in the city’s aqueduct projects.

Then in 2006 a breakthrough came. After complaining to the head of the city’s public works division about substandard pipe he saw being installed at one site, he was invited to meet Nicolo Milioto, head of Mivela Construction Inc. and a major player in the Montreal construction industry.

Mr. Milioto was impressed by the pipes produced by Mr. Cadotte’s company, Ipex Inc.

“I got the impression he had ties with the city of Montreal,” Mr. Cadotte recounted Thursday before Quebec’s Charbonneau inquiry into corruption.

A little more than a month later, Robert Marcil, the public works head, issued a memo declaring from then on, due to “quality problems” with the cast-iron pipe that had been the norm, new projects would use an Ipex product called TerraBrute or its equivalent.

Mr. Cadotte, who was on vacation when the news came in, said he uncorked a bottle of wine to celebrate, and Ipex revved up production to meet short-term orders expected to be worth up to $800,000.

Then Mr. Milioto called him to another meeting in the fall of 2006. After some small talk, he cut to the chase.

“Mr. Cadotte, things are going well, it’s rolling. There’s just one thing that you need to know,” he said, according to Mr. Cadotte’s testimony.

“Because of the acceptance of your product by the city of Montreal, I’ve got some people to compensate.” Mr. Milioto said he needed $150,000 in cash to pay three unnamed city of Montreal officials “who did the work to get us here.”

Mr. Cadotte testified it was the second time in his 23 years as sales director he had been asked for a kickback. The first time was about 10 years earlier, when a private engineer said Ipex could be guaranteed of winning a municipal contract in the Laurentians if it paid a bribe.

If we don’t get on board, if we don’t give the money, we know that’s the end

The answer had been no back then, and Mr. Cadotte was certain it would be no again.

“We don’t get involved in projects where we make profits on the back of taxpayers,” he told the commission, headed by Superior Court Justice France Charbonneau.

After running Mr. Milioto’s demand by his superiors, Mr. Cadotte returned to give him the news: “Ipex doesn’t work that way.”

He figured Ipex was finished in Montreal. “If we don’t get on board, if we don’t give the money, we know that’s the end,” he testified. And to this day, Ipex has not been chosen to provide pipe for Montreal aqueduct projects, even though it sells its products to municipalities across eastern Canada.

We don’t get involved in projects where we make profits on the back of taxpayers

Commission counsel Denis Gallant produced an April 2007 memo from Mr. Marcil to his engineers, reversing his earlier edict and declaring TerraBrute would no longer be considered for city projects.

Mr. Marcil left the city in 2009 after it was revealed he had accepted a trip to Italy with another construction contractor, Joe Borsellino of Construction Garnier.

The commission has heard Mr. Milioto acted as a middle man between colluding construction companies and the Rizzuto crime family. The Royal Canadian Mounted Police recorded him entering a notorious Rizzuto hangout 236 times over two years. He was filmed receiving stacks of cash from various contractors, which he would then turn over to Mafia bosses.

Mr. Cadotte testified he got the impression Mr. Milioto was deciding on behalf of the city and of contractors what type of pipe would be used in the city’s waterworks.

MONTREAL – The first few times Montreal businessman Michel Leclerc ran up against a construction cartel seeking to control bids on city contracts, he dug in his heels. When the head of a rival company offered him $50,000 to withdraw one winning bid and paid a visit to advise him against bidding on another project, he ignored the intimidation.

A bomb threat was called in to his office, a company vehicle was stolen and vandalized, but he went ahead and took the jobs. “

You have to stand up and be stubborn to be able to get work for yourself and your employees,” Mr. Leclerc testified Monday at the Charbonneau inquiry into corruption.

That was his attitude in 1997, but it did not take Mr. Leclerc long to realize his company, Terramex Inc., could get work and avoid grief by playing the game.

In 1998 he was preparing a bid for a sidewalk contract when Nicolo Milioto, the owner of Mivela Construction Inc. and Montreal’s self-described Mr. Sidewalk, came to see him.

“Listen, in Montreal, I do the sidewalk contracts,” Mr. Milioto told him.

The inquiry has heard that Mr. Milioto was a middleman between the Mafia and construction contractors, but Mr. Leclerc said he was unaware of that connection at the time. He said he found Mr. Milioto more “persuasive” and “imposing” than the previous contractor who tried to push him aside, and concluded Mr. Milioto could drive him out of business if he chose to.

“It’s an established system. You have to give in to it,” he testified.

And like that, he began participating in rigged bids, adding an extra 3% to his bills to finance political kickbacks, falsifying invoices to generate cash and on one occasion paying $5,000 cash to a city engineer to ensure payment of an outstanding bill. He couldn’t beat the cartel, so he became an active member.

Mr. Leclerc’s testimony corroborated what previous witnesses have said about an extensive collusion scheme that inflated the prices Montreal paid for its public works.

And he offered new insight into how deeply implanted the system was. He described the lengths he went to circumvent the system in 1996 to bid on a sewer contract in the borough of Verdun, which at the time was considered the turf of Paolo Catania’s Catcan Inc.

Mr. Leclerc said Catcan posted someone outside city hall to watch who was submitting bids. If an unexpected bidder showed up, Catcan would have a second bid ready with a low price just to make sure it got the work and could freeze out others, he said. Fearing he would be recognized, Mr. Leclerc sent his daughter to file his company’s bid and told her to conceal the documents in a briefcase and use the side door where she wouldn’t be spotted by Catcan’s lookout.

Later, when Mr. Leclerc decided to play along, he would be advised who was the designated winner of a project. If it was not him, he would submit a fake bid to create the illusion of a competition. If it was his turn to win, he would call other companies to advise them what his price would be so they would not undercut him.

He would usually take a 15% profit margin, but other players claimed as much as 30%, he said.

When he began colluding on sidewalk jobs, Mr. Milioto told him to set aside 3% of the value of his work for “the political.” He said he never inquired who received the money.

The 3% cut was paid to Mr. Milioto in cash, and in order to generate the money he used a fake billing system that led to a conviction for tax evasion in 2010. Under the scheme, a supplier would submit a bill for more material than was actually used and Terramex would pay it, and then the supplier would pay back the difference in cash. The suppliers used the system to launder cash they received from residential work that was “almost 100% under the table,” Mr. Leclerc said.

By 2005, he was comfortable enough with the system that he barely blinked when a city engineer, Guy Girard, said to meet for lunch at a pricey Italian restaurant to resolve a bill for work that Terramex had done nearly a year earlier.

“I asked, what will it take to resolve the contract? He tells me it will take $5,000,” he said.

A few days later, he said, Mr. Girard, who has since retired, came by to collect an envelope holding $5,000 cash. The contract dispute was settled immediately.

Lawyer Marc Labelle says since his client is already awaiting trial, testifying before the inquiry could hinder his attempt to find an impartial jury.

A lawyer representing the inquiry says it’s interested in Desjardins’ involvement in a construction firm that specialized in decontamination.

Labelle notes that Desjardins’ earlier failed attempt to have a subpoena quashed before the Quebec Superior Court received heavy media coverage and he says any testimony before the inquiry would get 10 times more attention.

The lawyer asked for commission counsel to make sure it was absolutely necessary for Desjardins to testify, and, if so, that it be done behind closed doors under a publication ban.

Simon Tremblay, a commission counsel, called Desjardins’ request premature and noted the date of his murder trial has not even been set.

France Charbonneau, who heads the commission, says she’ll deliberate on the request.

]]>http://news.nationalpost.com/news/canada/reputed-mafia-boss-fights-to-avoid-testifying-at-quebec-corruption-inquiry/feed0stdRaynald Desjardins is escorted into SQ headquarters Tuesday after his arrest in connection with the Nov. 24 shooting death of Salvatore Montagna‘Next time you won’t be walking away': Contractor stood up to Mafia threats, Quebec inquiry hearshttp://news.nationalpost.com/news/canada/charbonneau-inquiry
http://news.nationalpost.com/news/canada/charbonneau-inquiry#commentsFri, 16 Nov 2012 02:15:49 +0000http://news.nationalpost.com/?p=233614

With its stream of testimony from crooked contractors and corrupt civil servants, Quebec’s Charbonneau commission has not been a place to boost one’s faith in human nature.

But on Thursday, a businessman from Quebec City briefly changed that.

Martin Carrier, president of Céramiques Lindo, was praised for his courage after he recounted his experience standing up against Mafia attempts to control Montreal’s construction industry.

Mr. Carrier testified that he was driving his daughter to guitar class one Saturday morning in 2004 when his cell phone rang. A recording of the call was played for the commission. His daughter answered, and then passed the phone to her father.

Charbonneau CommissionA card addressed to Martin Carrier.

“Mr. Carrier, Martin Carrier?” the caller asked.

“Yes.”

“You did some ceramic work in Montreal?”

“Yes.”

“We’d like you to stop coming here to do work.”

“Who are you?”

“It doesn’t matter who I am, OK? Because the next time you won’t be walking away from here . . . . You’ve been warned.”

Mr. Carrier testified that he knew a Montreal competitor, Francesco Bruno of B.T. Céramique, was unhappy he had bid on a job at the Université de Montréal worth $400,000. A week after he attended a meeting for bidders, Mr. Bruno called to tell him he was short of work and it was his turn to land a contract, Mr. Carrier testified. Eventually Mr. Carrier’s turn would come if he played along.

Mr. Carrier talked it over with his partner and they decided to proceed with his bid. “I called him back and said, ‘We don’t work like that,’ ” he said.

After the threatening call, he went to police. A month later he got another call from the same person, he said. This time it was very short: “You didn’t listen. We warned you. It’s over.”

You didn’t listen. We warned you. It’s over

It was two years later, after a police operation led to the arrests of high-ranking members of Montreal’s Rizzuto Mafia clan, that an RCMP officer informed him the threats had come from Francesco Del Balso, an underboss for the Rizzutos with a violent reputation. He pleaded guilty in 2008 to cocaine trafficking and conspiracy, including extortion, and received a 15-year sentence.

Even before learning who had been on the other end of the call, Mr. Carrier said he was angered and shaken by the threats. “We are supposed to be free in Quebec, be able to go where we like and not be controlled,” he said. He said his business became more selective in which projects it bid on, looking at “who it came from, who was likely to bid” in order to avoid ruffling feathers.

Charbonneau CommissionA card addressed to Martin Carrier.

In 2010, Mr. Carrier told his story to a TV news show and was hit with a libel suit from Mr. Bruno, which was later withdrawn. The following spring, a greeting card arrived for him at his office offering “the most sincere condolences.” Inside was a personalized message: “Dear friend. Don’t bid any more in Montreal. You run the risk of having your family receive a card just like this. Final warning.”

He turned the card over to police but they were unable to find fingerprints. He told the inquiry he associated it with Mr. Bruno. “I don’t know who else wanted to stop me from bidding in Montreal,” he said.

B.T. Céramique had its contractor’s licence stripped last January by Quebec’s Régie du batiment. The company and Mr. Bruno pleaded guilty to eight counts of tax evasion in 2011 and received a $1.3-million fine.

Commission investigator Eric Vecchio testified that he interviewed Mr. Del Balso at a federal penitentiary to discuss the threats against Mr. Carrier. Mr. Del Balso told him he made the calls as “a favour” to Nicolo Rizzuto Sr., the Mafia patriarch killed in 2010, the inquiry heard.

As Mr. Carrier left the stand, Superior Court Justice France Charbonneau, who heads the commission, offered praise that contrasted with the pointed questions and rolled eyes directed at previous witnesses.

“Mr. Carrier, I thank you very much and I congratulate you for the exceptional courage you have shown,” she said, “and I encourage others to follow your lead.”

The Quebec City man, Martin Carrier, said he got a phone call at home in 2004. His daughter answered the phone and passed it to him.

On the other end of the line was a man with a heavy Italian accent. He warned him to stop working in the city, in the first of two similar phone calls Carrier received.

Carrier asked the man for his name. That prompted a curt reply.

“Never mind who I am,” the caller said. “Because the next time you won’t be walking away from here…

“Thank you and have a nice day.”

He reported the initial phone call to police near Quebec City. The RCMP later came to visit him and told him that they’d recorded that call. They said the caller was Francesco Del Balso, one of the senior-most members of the Rizzuto crime family and one of the family’s enforcers.

The tape was played Thursday at the inquiry.

Later, when he didn’t back down, Carrier received a condolence card by courier at his office. It was the kind of card sent to a grieving family after a death.

The printed side of the card said: “Sincerest condolences.” In neat handwriting, on the other side, the card read: “Dear friend, stop bidding in Montreal. If not, your family will receive a card just like this one. Final warning.”

At the end of his testimony today, Carrier was saluted by inquiry chair France Charbonneau.

“I thank you, and I congratulate you for your extraordinary courage,” she said.

]]>http://news.nationalpost.com/news/canada/montreal-mob-boss-used-death-threats-to-control-construction-industry-inquiry-hears/feed0stdBusinessman Martin Carrier testifies at the Charbonneau inquiry looking into corruption in the Quebec construction industry on November 14, 2012 in Montreal. Carrier says he received a threatening phone call telling him not to bid on a construction project.City engineer tells Quebec inquiry he refused companies’ offers of prostitutes — he only took the wine, hockey ticketshttp://news.nationalpost.com/news/canada/city-engineer-tells-quebec-inquiry-he-refused-offers-of-prostitutes-he-only-took-the-wine-dinners-and-hockey-tickets
http://news.nationalpost.com/news/canada/city-engineer-tells-quebec-inquiry-he-refused-offers-of-prostitutes-he-only-took-the-wine-dinners-and-hockey-tickets#commentsWed, 14 Nov 2012 05:10:23 +0000http://news.nationalpost.com/?p=232911

MONTREAL — A Montreal municipal official was offered prostitutes’ services as a gift from construction companies, he testified Tuesday at Quebec’s corruption inquiry.

The suspended Montreal engineer said he received numerous bottles of wine, fancy dinners and hockey tickets — and he added that companies’ generosity sometimes got a little more personal.

Gilles Vezina said he was offered the services of an escort on at least two occasions by two different construction bosses in the late 1980s or early 1990s.

Gilles Surpenant and Luc Leclerc, two retired Montreal officials, have admitted to accepting all sorts of kickbacks and gifts in exchange for helping to fix contracts.

Vezina is still working for the city, although he is under suspension. He said he only learned of the kickbacks while hearing the two men testify in front of Quebec’s inquiry over the past few weeks.

On Monday, Vezina admitted that he had a chummy relationship with Mafia-linked contractors — having attended a birthday party for construction mogul Frank Catania and the marriage of a daughter of construction boss Nicolo Milioto, where he gave a $300 present.

He said receiving the gifts didn’t influence his decisions.

The confidence of Laval residents has been badly shaken in recent months. I want to take action to revive confidence … I want to know what happens in Laval

Vezina, who was Leclerc’s superior, was in charge of assigning Leclerc to different project.

A commission counsel asked why Leclerc was often assigned to work with certain companies, like that of Milioto — a construction boss who has been described by the inquiry as an intermediary with the Mafia and a municipal party.

But Leclerc’s boss brushed off any notion of impropriety.

He justified the high number of projects given to Leclerc, saying the engineer was fast and efficient.

Vezina was suspended by the city after his name came up in testimony during the corruption inquiry. The Charbonneau commission has spent the past several weeks exposing cozy ties between the Italian Mafia, construction companies, and corrupt municipal officials.

Allegations that Gerald Tremblay turned a blind eye to illicit financing of his municipal party prompted the Montreal mayor to resign. Tremblay denied that accusation, but said he was quitting for the good of the city.

Gilles Vaillancourt, mayor of Laval for 23 years, quit under a cloud of suspicion.

A former construction boss, Lino Zambito, testified that Vaillancourt received a kickback on contracts handed out in Laval. Vaillancourt denied those allegations and others aimed at him previously that he offered bribes to people involved in provincial politics.

That has prompted the provincial government to step in.

Vaillancourt’s party was so dominant that no opposition members were elected to city council, prompting concern about oversight of the municipal administration.

In Quebec City, Municipal Affairs Minister Sylvain Gaudreault announced Tuesday that an auditor would be assigned to oversee contracts handed out in Laval.

The auditor would look at all contracts handed out by the city, including those for planning and real-estate transactions. The person, who has not been named, would report back to Gaudreault periodically over the next year.

“The confidence of Laval residents has been badly shaken in recent months,” Gaudreault said in a statement. “I want to take action to revive confidence … I want to know what happens in Laval.”

That announcement has prompted a standoff with the pro-Vaillancourt city administration.

The city’s executive committee chairman announced Tuesday that no interim mayor will be named until the province explains its decision to appoint an auditor.

In Montreal, an interim mayor will be chosen by secret ballot by city councillors on Friday. Montreal has two opposition parties and a handful of councillors who sit as independents.

LAVAL, Que. — A mayor’s 23-year reign running the city next to Montreal has drawn to a close.

Embroiled in a provincewide corruption scandal, the mayor of Laval, Que., has announced his resignation.

Gilles Vaillancourt, who since 1989 has run the suburb with little competition, says he doesn’t deserve to have his reputation tarnished but he says the damage is already done.

Vaillancourt, 72, has been on sick leave since Oct. 24.

Meanwhile, Quebec’s anti-corruption unit has closed in on Laval in recent weeks, raiding numerous engineering firms and businesses in addition to Vaillancourt’s own home, condo, offices and his bank safety-deposit boxes.

Vaillancourt’s name has also been mentioned in ongoing testimony before Quebec’s Charbonneau inquiry into corruption.

Related

Former construction boss Lino Zambito testified that Vaillancourt received a kickback on contracts handed out in Laval.

Vaillancourt has denied the allegations. He has also denied past allegations that he offered bribes to people involved in provincial politics.

Laval police had a police car stationed outside Vaillancourt’s home early today.

A police spokesman said it was purely to maintain order after a reporter had gone onto the property the previous day in an effort to speak to the mayor.

Const. Frank Di Genova said it wasn’t Vaillancourt that made the request.

Allegations that the Montreal mayor turned a blind eye to illicit financing of his own municipal party prompted Gerald Tremblay to resign last Monday as mayor of Montreal. Tremblay also denied the allegations, but said he was quitting for the good of the city.

Unlike Vaillancourt, the former Montreal mayor has never been accused of personally pocketing money.

Montreal still faces a leadership crisis, following the mayor’s departure.

Reports say the city’s No. 2 could be quitting out of frustration with his colleagues — not only because he was passed over as a candidate for interim mayor, but also because he opposes a plan to push ahead with Tremblay’s 3.3 per cent hike on property taxes.

The city must choose a temporary replacement for Tremblay by next Friday.

]]>http://news.nationalpost.com/news/canada/embroiled-in-quebecs-corruption-scandal-layal-mayor-resigns/feed4stdGilles Vaillancourt speaks at a news conference Friday, Nov. 9, 2012 in Laval, Que. Vaillancourt announced his resignation as mayor.Graeme Hamilton: Montreal's mayor casts himself as a scapegoat as he resigns in midst of corruption scandalhttp://news.nationalpost.com/full-comment/graeme-hamilton-montreals-mayor-casts-himself-as-a-scapegoat-as-he-resigns-in-midst-of-corruption-scandal
http://news.nationalpost.com/full-comment/graeme-hamilton-montreals-mayor-casts-himself-as-a-scapegoat-as-he-resigns-in-midst-of-corruption-scandal#commentsTue, 06 Nov 2012 01:49:20 +0000http://fullcomment.nationalpost.com/?p=96337

Eleven years after being elected with a mission to unite the new Montreal megacity, Mayor Gérald Tremblay resigned Monday night, leaving a city with a bruised reputation and in greater disarray than when he arrived.

With new evidence of corruption, collusion and illegal political financing in Montreal surfacing almost daily at an ongoing public inquiry, Mr. Tremblay had faced mounting calls for his departure.

But in his parting speech, Mr. Tremblay portrayed himself as a scapegoat whose only mistake was to place too much trust in those around him. “I am making what I consider to be the ultimate sacrifice, my last act of love in the higher interest of Montreal,” Mr. Tremblay said in a televised address from city hall.

Until his 7 p.m. announcement Monday, Mr. Tremblay, 70, had dropped from public view since tabling a budget last Tuesday that hit property-owners with tax increases.

He cancelled a major speech to the Montreal Board of Trade scheduled for Friday, and on Thursday his office announced that he would be booking off until Monday to take a “few days of rest.”

His absence came in a week that heard the most damning testimony yet against his administration at an inquiry into corruption in the construction industry.

My father once told me never to go into politics because it is dirty and they were going to destroy me

Martin Dumont, a former organizer for the Mayor’s party, Union Montreal, told the Charbonneau commission that the party was awash with illegal cash donations.

Mr. Dumont said the party’s chief fundraiser had a safe in his office so crammed with $100 and $1,000 bills that he once needed help closing it. He said construction contractors and engineers who benefited from city contracts helped fill the Union Montreal safe. He recounted an incident in which one generous donor, a sidewalk contractor, threatened him in his office after he had questioned an inflated price for a repair job.

Most damaging to Mr. Tremblay, who has never been accused of personally benefiting from the corruption around him, was Mr. Dumont’s testimony that the mayor had walked out of a 2004 meeting rather than hear his concerns about shady election financing. “I don’t need to know that,” he quoted the mayor as saying.

Mr. Tremblay called Mr. Dumont’s story false and protested that he was not allowed to appear immediately before the commission to offer his side of the story. “I was not part of their game plan, at least in the short term,” he said.

He said he is experiencing “a period of unbearable injustice” that he would never have thought possible in a society governed by the rule of law.

“My father once told me never to go into politics because it is dirty and they were going to destroy me,” he said, “but my passion and my love for Quebec and Montreal decided the path I had to follow.”

I fervently hope that one day it will be recognized that I fought, often alone, against this system, this collusion, this corruption

The former provincial cabinet minister said he had heard rumours of corruption at city hall but never received proof until it was too late. The only reason he ran for a third term in 2009 was to “finish the clean-up,” he said.

“I fervently hope that one day it will be recognized that I fought, often alone, against this system, this collusion, this corruption.”

The Charbonneau inquiry has heard from two corrupted city engineers who described pocketing more than $1-million in bribes between them in exchange for inflating the prices on public-works contracts. Former construction contractor Lino Zambito testified that companies winning city contracts had to pay a 3% “tax” to Union Montreal.

Mr. Tremblay’s departure follows the ignoble exits of several of his senior associates. Frank Zampino stepped down as Mr. Tremblay’s right-hand man on city council in 2008 and this year was arrested on charges of fraud and breach of trust. The commission has heard he was involved in bid-rigging and accepted benefits from contractors, accusations he denied.

Bernard Trépanier, who was in charge of finances for Union Montreal, has been charged following an anti-corruption investigation. Mr. Zambito identified Robert Abdallah, who was general manager of the city from 2003-06, as having received kickbacks for directing sewer work to a specific supplier.

Fallout from the Charbonneau commission has also hit the suburb of Laval, north of Montreal, where Mayor Gilles Vaillancourt has been on medical leave since Oct. 24. His absence followed testimony that he received kickbacks on construction contracts and police raids on his home. On Monday, a statement form Laval’s executive committee said Mr. Vaillancourt is continuing to rest and has not decided whether to resign. “Once his decision is taken, it will be shared with you,” the statement said.

Montreal city council, which is controlled by Union Montreal, will select a replacement for Mr. Tremblay to serve until the next municipal elections in November 2013.

MONTREAL – Montreal’s mayor has resigned in the midst of a corruption scandal, becoming the highest-profile political casualty of the controversies currently rocking Quebec.

Gerald Tremblay said he had done nothing wrong but was stepping aside for the greater good of a city that is now politically paralyzed. Large construction contracts have been frozen and even the municipal budget has had to be rewritten in recent days.

“I cannot help anymore, given the circumstances,” Tremblay said in a solemn resignation announcement late Monday at city hall.

The 70-year-old mayor held onto office just long enough to delay an election to replace him — which would have been triggered had he resigned only a few days earlier.

Tremblay avoided the public eye last week and took two days off work. Because he left after Nov. 3, one year before the next scheduled election, provincial law says he can now be replaced with an interim mayor chosen by the city council that is controlled by his scandal-plagued party.

He insisted he was unaware of corruption in his administration and only learned about it after the fact, saying Monday that he felt betrayed by the people who had abused his trust.

“My father always told me not to go into politics because it was dirty and people would destroy me,” Tremblay said, adding that his love of Quebec and Montreal drew him to provincial and municipal politics over a 25-year career.

Monday’s announcement came after years of scandal that, over time, inched uncomfortably close to the mayor. Tremblay’s onetime closest associates have either been slapped with criminal charges or been accused of corruption at an ongoing inquiry.

The latest, sharpest blow came last week: a witness at the inquiry said Tremblay was not only aware of illegal financing within his political party but was indifferent to it.

This was after the mayor had spent more than three years telling Montrealers that he’d been unaware of any corruption within his party or administration.

In making his resignation announcement, Tremblay denied that the 2004 meeting ever even happened. He said other recent allegations against him have been motivated by “hidden agendas” that would be exposed someday.

“That meeting never took place. Those allegations are false,” Tremblay said of the testimony from former aide Martin Dumont, who said the mayor got up and left the room during a 2004 meeting the moment illegal party financing came up.

“I am going through a period of unbearable injustice… One day, justice will be done.”

True or not, the latest allegation from his former party worker, in testimony at the Charbonneau inquiry, was incendiary enough to torch his administration. There had already been calls for his resignation. Now he found himself suddenly struggling to pass a budget.

Within only two days last week, his administration was forced to back down from a budget that had included property-tax hikes.

The tax increase had caused enough of a backlash that even the provincial government weighed in on it. The PQ government echoed the sentiments of angry citizens who fumed at the idea of having to pay more to an administration whose legitimacy had been so tarnished.

Amid the outcry, Tremblay decided to take a short break last week. He skipped work for two days and cancelled a pair of public appearances. The timing of his no-show was politically significant.

If Tremblay had quit before Nov. 3, one year ahead of the 2013 municipal election, it would have triggered an early mayoral vote. A resignation less than one year before an election, under Quebec law, means city council can pick a replacement. Tremblay’s party controls council.

He turned 70 in September.

A lawyer by trade, he was called to the Quebec Bar in 1970. He also holds an MBA from Harvard Business School.

A former Quebec provincial politician, Tremblay was elected to the provincial legislature as a Liberal in 1989 and he served as industry minister until 1994.

His entry into municipal politics was propelled a decade ago by the last Parti Quebecois government’s plan to merge the island of Montreal into one megacity.

The plan was, ironically, led by his current adversary at city hall, Louise Harel, who was the provincial municipal-affairs minister.

Tremblay harnessed the angst and anger over the plan, getting overwhelming support from suburban and anglophone voters and sweeping to power in 2001.

He was re-elected in 2005 and again in 2009 for his third term as mayor. Less than 40 per cent of Montrealers bothered to vote last time. Allegations had already begun surfacing about irregularities in the awarding of public contracts and illegal political financing.

Tremblay survived the vote, partly because the main opposition party led by Harel dealt with controversies of its own.

He was contrite following his win.

“I want Montrealers to know that I know the mandate they’ve given me comes with great responsibility,” Tremblay said following his narrow 2009 victory. “I’m aware that the confidence of Montrealers has been put to the test.”

MONTREAL – Luc Leclerc had only been on the job as a city engineer a few months when one of his colleagues told him to throw on his coat and follow him and the rest of the crew outside. It was December 1990.

A pickup truck pulled up, and its tailgate dropped to reveal a collection of parcels, addressed to the municipal engineers who oversaw Montreal public-works projects. The next few days saw a parade of deliveries that would put Santa to shame, “gifts” from construction firms that relied on the engineers’ co-operation to pad their bottom lines.

Testifying this week at the Charbonneau commission into corruption in Quebec’s construction industry, Mr. Leclerc said he was initially astounded by how readily and openly civil servants accepted favours – wine, meals, rounds of golf, hockey tickets, even hams – from the people they were supposed to be overseeing. But he quickly fell in line. “When in Rome, do as the Romans,” he explained. Over the course of his 20 years with the city, he estimates he accepted $500,000 in cash bribes on top of countless other benefits, including vacations and free work on the construction of his home.

The extent of corruption uncovered so far by the commission has angered Quebecers and left Mayor Gérald Tremblay on the ropes. After cancelling a major speech scheduled for Friday, he announced he would take a few days off to rest. It is widely expected he will soon announce his resignation.

The commission has heard that his party was awash in illegal donations, and a former organizer testified this week that Mr. Tremblay walked out of a meeting when he raised concerns about illegal election spending. But while the mayor is an obvious target for public wrath, there has been no evidence that he was personally corrupt.

Just as eye-opening, in a province where the civil service has long been valued as an avenue for francophone advancement and a symbol of the province’s modernization, is the ease with which employees like Leclerc were corrupted.

“The public administration is the stronghold of francophone Quebecers, the vehicle of the Quiet Revolution, one of the pillars of Quebec Inc.,” Journal de Montréal columnist Benoît Aubin wrote recently in assessing the testimony of another city engineer, Gilles Surprenant. “But this sacred cow was not up to the task; it betrayed our trust and our hopes.”

Mr. Leclerc was part of a generation of Quebec baby boomers for whom the Quiet Revolution of the 1960s had opened wide the doors of higher education and made government a prime employer. His golfing buddy and fellow bribe-taking city engineer, Mr. Surprenant, followed a similar path, joining the city’s public works department a year later. He told the inquiry he took an estimated $700,000 in graft before retiring in 2009.

The payoffs were part of a scheme under which the engineers smoothed the way for construction firms to overbill the city for millions of dollars. Mr. Surprenant would inflate estimates for projects while Mr. Leclerc found ways to allow contractors to charge for “extras” — unbudgeted work that was not actually performed. Not only were they helping fleece taxpayers, they were betraying the trust placed in a professional civil service. Mr. Aubin called it “the betrayal of the clerks.”

Of course, it is not as if the civil service is universally admired in Quebec. But the state apparatus as a whole has been held in higher regard here than elsewhere in Canada ever since it provided the means to shake loose of restrictions imposed by the Church and forge a new francophone power base.

“Quebecers today are in fact still quite attached to the image of the government that emerged in the 1960s during the Quiet Revolution,” Joseph Facal, a former provincial cabinet minister who is now a professor at the HEC business school, wrote in a 2006 paper. “That is, the notion of government as holding the key to the collective development of francophones and their entry into modernity – even if the government’s role has gone through many changes in the last 40 years.”

At first I refused categorically, saying it was out of the question to have my hands tied and I did not want to owe anything to a contractor. At the end of the meal, I said yes

The evidence before the Charbonneau commission makes clear the attachment is not always warranted. Mr. Surprenant repeatedly referred to the “five-star service” he offered, but that was for the contractors who showered him with cash, not the taxpayers who paid his salary.

For a professional bound by a code of ethics, he offered remarkably little resistance. Not counting the Christmas gifts and golf outings that were just part of the “business culture” at Montreal public works, he said the first time he was truly corrupted came with the offer of a golf holiday in the Dominican Republic. Paolo Catania of F. Catania and Associates extended the invitation to him and Mr. Surprenant over dinner in 1995, he said.

“At first I refused categorically, saying it was out of the question to have my hands tied and I did not want to owe anything to a contractor,” he testified. But the evening wore on, the wine flowed and Mr. Catania proved persuasive. “At the end of the meal, I said yes,” Mr. Leclerc testified.

Two years later, another contractor slipped him a Christmas card over dinner containing a “beautiful pink $1,000 bill.” Again he hesitated, he said, but again he kept it. Word soon got out in the industry that he could be bought. “From one day to the next, everyone knew,” he said.

Like Mr. Surprenant, Mr. Leclerc testified he was caught up in a system. The small team of public works engineers was “putty in the hands of the contractors who wanted to corrupt us,” he said. Mr. Surprenant had called the malfeasance an “open secret,” and Mr. Leclerc agreed it was not well hidden. “I just think nobody took the bull by the horns,” he said.

So far the commission has heard from only two corrupt bureaucrats, but its work is far from over. Mr. Surprenant testified that his two direct superiors and three of his co-workers, including Mr. Leclerc, were aware that construction firms were colluding on the bidding of contracts. Robert Marcil, the head of the public works division, was fired in 2009 after it was revealed that he had taken a holiday in Italy with Joe Borsellino, owner of a major Montreal construction firm.

Mr. Surprenant testified that another superior, Yves Themens, once called him into his office to show him a stack of $100 bills that he said had come from “Tony.” Mr. Surprenant said that he assumed he was referring to Tony Conte, owner of Conex Construction.

Mr. Aubin wrote that the testimony before the Charbonneau commission has revealed not only corruption but also a tolerance of inefficiency and indifference to waste in the civil service. “The largest supplier of stable, well-paid jobs, the traditional bastion of Québécois French power, and, in the eyes of many, the main motor of our economy, the heart of our citadel,” he wrote. “But look at what it has become.”

Tremblay cancelled a number of public appearances this week including a major speech scheduled for tomorrow outlining his economic legacy.

The timing of today’s announcement is important — if Tremblay quits before Nov. 3, one year ahead of the next municipal election, an early vote for the mayoralty will be held.

If he quits afterward, under the provincial law, he can be replaced by city council without an election. His party holds the majority on council.

Municipal elections across the province are to be held in November 2013.

In testimony earlier this week, Martin Dumont, a former political organizer for Tremblay who held several roles in the Harper government after he left municipal politics, alleged that the mayor knew there was illegal spending during the campaign leading up to a December 2004 municipal byelection.

Dumont told the Charbonneau Commission about a meeting that he attended along with Tremblay and Marc Deschamps, the official agent, two weeks before the byelection.

He testified that during the meeting, Deschamps told him not to worry and pulled out a document which indicated two budgets — one was the official campaign budget of $43,000 and the other a so-called “unofficial” budget of $90,000.

Dumont said at that point Tremblay said he didn’t want to know about that and left the room.

Dumont told the commission that the maximum allowable spending limit for the byelection was $46,000, but in the end, it cost Union Montreal $110,000.

MONTREAL — A crooked Montreal civil servant says it would have been difficult for any honest supervisor to catch him because he was so good at doctoring contracts.

The now-retired city engineer, Luc Leclerc, told a public inquiry Thursday that he was adept at manipulating construction contracts to inflate the final price tag awarded to companies that had given him kickbacks.

Leclerc said he always hid the phony expenses behind legitimate unexpected costs that popped up over the course of a project.

He has been less apologetic while testifying than another colleague who repeatedly expressed remorse for what he had done. Between the two of them, they pocketed more than $1.2-million in kickbacks from construction companies that benefited from rigged bids.

Leclerc illustrated his attitude with an anecdote.

He described how some companies were unhappy when a new player, Lino Zambito and his Infrabec company, arrived on the scene a little over a decade ago. He said he joked with Zambito that he had the power to make life difficult for him — to keep him from winning contracts and diluting the spoils for everyone else.

Of course, Leclerc said, he didn’t do that in the end.

“I never made life difficult for anyone,” Leclerc said.

“On the contrary, I had a reputation for offering five-star service.”

Leclerc has already admitted to pocketing more than $500,000 from companies — in addition to vacations, hockey tickets, wine, Christmas baskets, ham, and home renovation work.

He has described a golf vacation with the head of Canada’s most powerful Mafia family, Vito Rizzuto, and described the don as a charming and funny travel companion.

]]>http://news.nationalpost.com/news/canada/i-had-a-reputation-for-offering-five-star-service-corrupt-montreal-civil-servant-admits-at-charbonneau-inquiry/feed0stdA sign pointing the way to the hearing room at the Charbonneau commission is shown in Montreal, Wednesday, September 26, 2012, which is an inquiry looking into corruption and collusion in Quebec's construction industryMontreal Mayor Gerald Tremblay knew about illegal spending, Quebec corruption inquiry hearshttp://news.nationalpost.com/news/canada/montreal-mayor-gerald-tremblay-knew-about-illegal-spending-quebec-corruption-inquiry-hears
http://news.nationalpost.com/news/canada/montreal-mayor-gerald-tremblay-knew-about-illegal-spending-quebec-corruption-inquiry-hears#commentsTue, 30 Oct 2012 16:04:58 +0000http://news.nationalpost.com/?p=227434

MONTREAL — A former political organizer for Mayor Gerald Tremblay’s Union Montreal party alleges that the mayor knew there was illegal spending during the campaign leading up to a December 2004 municipal byelection.

Martin Dumont, who also held several roles in the Harper government after he left municipal politics, made the allegation today during an appearance before the Quebec corruption inquiry.

Tremblay told reporters at a news conference on another matter that the allegations are false.

Allen McInnis/Postmedia NewsMontreal Mayor Gerald Tremblay at city hall in Montreal on Wednesday, April 13, 2011.

Dumont told the Charbonneau Commission about a meeting that he attended along with Tremblay and Marc Deschamps, the official agent, two weeks before the byelection.

He testified that during the meeting, Deschamps told him not to worry and pulled out a document which indicated two budgets — one was the official campaign budget of $43,000 and the other a so-called “unofficial” budget of $90,000.

Dumont said at that point Tremblay said he didn’t want to know about that and left the room.

Dumont told the commission that the maximum allowable spending limit for the byelection was $46,000, but in the end, it cost Union Montreal $110,000.

]]>http://news.nationalpost.com/news/canada/montreal-mayor-gerald-tremblay-knew-about-illegal-spending-quebec-corruption-inquiry-hears/feed0stdFormer Union Montreal candidate Martin Dumont testifies at the Charbonneau inquiry looking into corruption in the Quebec construction industry Tuesday, October 30, 2012 in Montreal.Montreal Mayor Gerald Tremblay at city hall in Montreal on Wednesday, April 13, 2011.